Online cryptocurrency wallet accidentally torches $300M worth of Ethereum
A buggy blockchain appears to have been responsible for the recent accidental loss of more than $300 million worth of “Ether” cryptocurrency, new reports indicate. It was actually a series of bugs that supposedly led an Ethereum developer to mistakenly take control of and permanently lock up – vanishing into thin air! – this mass of digital funds, highlighting a serious flaw with the digital currency’s integrity, at least when stored in the distributed Ethereum system.
Unlike most cryptocurrency hacks that have been reported in recent years (including those associated with Bitcoin), this one is not said to have been intentional or malicious in any way. It was a simple mistake – and yet one that has created major turmoil amongst cryptocurrency holders everywhere who are now questioning whether or not their funds are truly safe when stored in online digital wallets such as Ethereum, which clearly has some serious problems.
In this case, Ethereum’s digital app platform, which was built by a developer known as Parity, failed to keep Ether funds from being unintentionally eliminated due to human error. In fact, the developer’s “panicked” efforts to salvage the funds by returning them back to their rightful owners only made the problem worse.
As the whole fiasco was taking place, hackers apparently entered the system and stole about $32 million worth of the misplaced coins from several of the multi-signature wallets, which is bad enough on its own. But in the process of the developer trying to remedy the problem, a second flaw was exposed that resulted in one user becoming the sole owner of every single multi-signature wallet on the platform.
“The user, ‘devops199,’ triggered the flaw apparently by accident,” writes Alex Hern for The Guardian. “When they realised what they had done, they attempted to undo the damage by deleting the code which had transferred ownership of the funds. Rather than returning the money, however, that simply locked all the funds in those multisignature wallets permanently, with no way to access them. …
“Effectively, a user accidentally stole hundreds of wallets simultaneously, and then set them on fire in a panic while trying to give them back.”
Read more on newstarget.com.